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I analyze the ability of capacity payment mechanisms to alleviate underinvestment in electricity generation capacity. I derive the optimal capacity payment parameters under two capacity payment mechanisms, when capacity demand is price-elastic and when it is price-inelastic. Price-elastic...

Promoting competition among electricity producers is primarily targeted at ensuring low electricity prices for consumers. Producers could, however, withhold part of production facilities (i.e., apply a capacity cutting strategy) and thereby push more expensive production facilities to satisfy...

In dem Paper wird untersucht, wann ein vertikal integrierter Netzbetreiber einen Anreiz hat, durch Fordern hoher Netznutzungsentgelte Wettbewerber vom Strommarkt fernzuhalten (Preisstrukturmißbrauch). Es wird als kontraintuitives Ergebnis abgeleitet, daß ein Kostennachteil des Netzbetreibers...

This paper explores the relation between the regulation of monopolistic upstream prices and the incentives of a vertically integrated input monopolist to discriminate third parties on the downstream market. Currently, this is an issue in network industries like telecommunications, electricity...

The European Commission is introducing new regulations on submission and publication of data in electricity markets (SPDEM) and on wholesale energy market integrity and transparency (REMIT). I discuss issues relevant for undertaking an evaluation such regulations. I argue that, for market...

An important goal of the European Commission is the promotion of the internal energy market (here specifically electricity), which requires sufficient and adequate cross-border interconnector capacity. However, cross-border interconnector capacity is scarce and, more importantly, the progress of...

We propose a difference-in-differences (DiD) approach to estimate the impact of incentives on cost reduction. We show theoretically, and estimate empirically, that German electricity distribution system operators (DSOs) pile up more costs in the year used to determine future prices when subject...